Trade of the Day: Applied Materials, Inc. (AMAT)

To receive further updates on this Applied Materials, Inc. (NASDAQ:AMAT) trade as well as an alert when it’s time to take profits, sign up for a risk-free trial of SlingShot Trader today

Today, we are opening a new bullish trade on Applied Materials, Inc. (NASDAQ:AMAT). As traders look around for buying opportunities on Wall Street, one area they continue to land on is technology — especially semiconductors — as companies are pouring a lot of their tax savings into technology upgrades. The stocks in this industry have been soaring higher for the past few weeks, and AMAT just set a new all-time closing high of $59.99 on Tuesday.

The stock had an intra-day high that was higher than that price when it released its third-quarter 2017 earnings in mid-November of 2017, but it has never closed as high as it did this week. This is a great sign for this stock, as it has been consolidating below resistance at $59 for the past week or so and is now breaking higher. We expect AMAT to retest its November high of $60.89 during the next week as it moves on to even higher highs.

Credit Suisse recently reiterated its “Outperform” rating on AMAT and bumped up its 12-month target for the stock from $74 to $75. While we aren’t looking for the stock to make that large of a move while we’re holding our bullish calls, we do anticipate the stock climbing up to our strike price of $62.50 in the short term.

‘Buy to open’ the AMAT April 62.50 Call (AMAT180420C00062500) for a maximum price of $1.90.

Follow our Facebook page to receive each Trade of the Day direct to your News Feed — and join the conversation.

You can learn more about identifying price patterns and using them to project how far you think a stock is going to move in our Advanced Technical Analysis Program.

InvestorPlace advisers John Jagerson and S. Wade Hansen, both Chartered Market Technician (CMT) designees, are co-founders of LearningMarkets.com, as well as the co-editors of SlingShot Trader, a trading service designed to help you make options profits by trading the news. Get in on the next SlingShot Trader trade and get 1 free month today by clicking here.

« How the Coming War with BlackBerry Could Hurt Facebook, Inc. Stock Strong Buy for AbbVie (ABBV) This Week »